The brains and money behind Supercell Oy, the Finnish developer behind popular mobile games Clash of Clans and Hay Day, have launched an early stage investment vehicle to give embryonic Nordic startups what their American counterparts in Silicon Valley receive from super angel investors: big investments with a long horizon.

Supercell CEO Ilkka Paananen is the biggest backer of a new investment vehicle.

Associated Press

A team including Finnish venture capital firm Lifeline Ventures, which funded Supercell in its early days, and several members of the Helsinki-based gaming company have raised €15 million ($21 million) to boost the local startup scene. “Our focus will be on startups from Finland and nearby countries such as Estonia and Sweden,” Petteri Koponen, one of Lifeline’s partners, said.

Popular in Silicon Valley, super angels are investors who can make sizable individual investments – typically starting in hundreds of thousands of dollars – in budding startups. This has given American startups a funding advantage compared with their competitors in less-developed startup hubs where early stage funding has been harder to raise.

Lifeline’s new investment vehicle is a firm, not a venture capital fund with a fixed investment period and expiration date when its investments are liquidated.

“We have no preset target date when we plan to exit from our investment. Instead we can be patient and stay in the same boat with the company’s founders as long as it takes to succeed,” said Timo Ahopelto, also a Lifeline partner.

Lifeline was an early investor in Supercell in 2010 when the company was founded. Three years later, the firm’s bet paid off when SoftBank bought 51% of Supercell.

Other Lifeline investments include the mobile game software tool developer Applifier, which was acquired by a bigger American software tool developer Unity Technologies for an undisclosed sum in March.

Finland, whose economy is roughly equal in size to the state of Missouri, has in recent years bred several successful startups, the most prominent examples being Supercell and Rovio Entertainment Ltd., the owner of the widely popular Angry Birds entertainment franchise.

However, due to the country’s small size and the relatively short history of its VC scene, individual early stage investments by Finnish investors have been small, typically around €50,000 ($70,000). As a result, promising Finnish startups have been compelled to seek early stage funding from abroad.

Supercell is a case in point. Initially its six founders combined invested €270,000 ($373,000). In addition, the company received an early stage loan of slightly less than €400,000 ($550,000) from Tekes, the Finnish Funding Agency for Innovation.

But for its first proper funding round of €750,000 ($1 million) in November 2010, Supercell couldn’t rely exclusively on Finnish investors but had to turn also to foreign investors, Paananen says.

Lifeline’s new venture aims to shake up this equation. It can easily make an early stage investment of €500,000 in a single startup. On top of this, a qualified startup can receive a matching amount of money from the state-funded Tekes in development grants and loans.

“This means that an early stage Finnish startup can now be even more amply funded than its Silicon Valley counterpart,” Paananen says.

The purpose of providing fairly ample funding at an early stage for a startup is to shield it from time pressures. “Say a good company gets a million early on, instead of having six months it can have 12 or even 18 months to get its team and business plan in the right alignment,” Ahopelto says.

Correction: Supercell’s €750,000 ($1 million) funding round was in November 2010. An earlier version of this article incorrectly said it was in November 2011.